Not it isn't. It is a regional branch of the ECB.

It sure as Hell doesn't act like it.

And what effing exchange rate poliy? There is no exchange rate in a currency union.

A currency union is an exchange rate policy.

And regarding the exchange rate of the euro, do you want to argue it is undervalued?

No, the €-Mark is about where it should be, since its external accounts are roughly in balance.

The problem is that Germany (and the Netherlands, Austria and to an extent Finland) want to run an internal current accounts surplus but do not want to finance the internal deficits this creates.

The opinion of the german government [...] was rightly or wrongly shared by a lot of other countries.

Yes, that's what I wrote: The German government and the BuBa pitched a hissy fit, and the rest of the EPP-PES shut up and fell back in line. You seem to be claiming that they would have done so even if Merkel and the BuBa had not pitched a hissy fit. In that case, one cannot help but wonder why the BuBa broke the confidentiality of ECB proceedings - confidentiality that was instituted at the BuBa's insistence (because the BuBa does not like democratic oversight of central bank operations). That seems like a rather drastic sort of step to take simply to voice a consensus position.

the position of the opposition is different,

Die Linke are talking sense most of the time, but they are at least two election cycles away from being in a position to appoint ECBuBa governors. As for the SPD and Die Grüne, their wage suppression policies from the last time they were in government are a substantial part of the problem (Hartz, anyone?). A stint in opposition may have reduced the amount of neoclassical brain rot in those parties, but I'll reserve judgment on that count until I see what they do the next time they have a chance to actually do something.

Regarding the Bundesbank, what are you talking about? How exactly can they pick up their marbles and go home?

Uh, by not clearing €-Mark transactions with other countries and reissuing D-Mark notes.

They are just a administrative sub-division of the ECB.

You know that and I know that, but from their public pontifications it does not appear that the BuBa officials have quite internalised that fact yet.

Bofinger isn't Sinn

Didn't say that. I said that neither understands national accounting. Which is true.

- Jake

If you only spend 20 minutes of the rest of your life on economics, go spend them here.